GENERAL COMMENTS:
Livestock contracts turned lower as Thursday evolved, feeling less and less confident that the market's recent gains will continue. Heading into Friday, the market will be heavily watching cash cattle trade. Hog prices closed lower on the National Direct Afternoon Hog Report, down $0.54 with a weighted average of $37.99 on 10,784 head. December corn is up 1/2 cent per bushel and December soybean meal is down $1.80. The Dow Jones Industrial Average is up 185.46 points and NASDAQ is up 109.67 points.
LIVE CATTLE:
Live cattle contracts closed the day lower, following steadily in line with the rest of the livestock complex's trend. August live cattle closed $0.32 higher at $102.62, October live cattle closed $0.47 lower at $106.97 and December live cattle closed $0.70 lower at $110.95. Packers upped their bids as the afternoon ticked by and some northern cattle traded mostly for $163, $3.00 higher than last week's weighted average. Not all feedlots in the north have sold cattle this week, and as Thursday hands the reins over to Friday's trade, there are some feeders that are adamant about their full asking price of $165 this week. Thursday's slaughter is estimated at 118,000 head, down 1,000 head from a week ago and down 4,000 head from a year ago.
Thursday's Actual Slaughter report wasn't as exciting for the cattle market as it was the hog complex. For the week ending July 25, 2020, slaughter totaled 639,971 head (down 0.94% from the previous week) and carcass weights were higher. Actual live weights totaled 1,368 pounds (up 10 pounds) and actual dressed weights totaled 836 pounds (up 6 pounds).
Boxed beef prices closed higher: choice up $1.09 ($204.66) and select up $1.19 ($192.01) with a movement of 143 loads (90.23 loads of choice, 14.86 loads of select, 17.61 loads of trim and 20.36 loads of ground beef).
FRIDAY'S CASH CATTLE CALL: Steady to $1.00 higher. Friday's trade will be interesting to watch as feeders have already moved this week's market $3.00 stronger but are stern about wanting the market $5.00 higher. Last week there were some feedlots that held out, and with supply being mostly current in the north, some feedlots could do that again if packers aren't interested in paying full price.
FEEDER CATTLE:
Feeder cattle contracts closed disappointingly, as the spot August contract fell below resistance levels that last Friday's market was able to push through. August feeders closed $1.32 lower at $143.47, September feeders closed $0.60 lower at $145.87 and October feeders closed $0.52 lower at $146.77. The feeder cattle market is in a precarious position as, technically, the board is topping, but feeder cattle throughout the country continue to be bought at stronger prices. At Winter Livestock Auction in Pratt, Kansas, compared to a week ago, feeder steers weighing 700 to 950 pounds sold $2.00 to $6.00 higher, and though feeder heifers weren't evenly tested, a stronger market was noted there as well. The CME feeder cattle index: up $0.19, $140.79.
LEAN HOGS:
Lean hog contracts closed mixed as the market was able to hold some positive trade within the nearby contracts, but the deferred contracts closed lower. August lean hogs closed $0.30 higher at $49.75, October lean hogs closed $0.10 lower at $49.20 and December lean hogs closed $0.02 higher at $51.50. Thursday's afternoon cash trade was lower, but packers bought a considerable volume of hogs. Although they traded for lower money, getting hogs moved is positive. Pork cutouts totaled 324.37 loads with 293.75 loads of pork cuts and 30.63 loads of trim. Pork cutouts values: up $3.76, $70.80. Thursday's slaughter is estimated at 476,000 head, 4,000 head less than a week ago and 1,000 head more than a year ago. The CME lean hog index 8/4/2020: up $0.11, $52.92.
Thursday's Actual Slaughter report was encouraging to the hog market as slaughter for the week ending July 25, 2020, was up 2.33% (totaling 2,575,764 head) from the previous week and carcass weights were down slightly. Actual live carcass weights totaled 283 pounds (down 1 pound) and actual dressed weights totaled 211 pounds (down 1 pound).
FRIDAY'S CASH HOG CALL: Steady. Keeping with the market's lower trend, cash hogs will most likely trade steady with the week.
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